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See what's trending for the November 15th deadline (Form 990) and resources for the upcoming tax season. Lacerte | ProConnect | ProSeries
See what's trending for the November 15th deadline (Form 990) and resources for the upcoming tax season. Lacerte | ProConnect | ProSeries
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- Partnership paid royalties to partners
Partnership paid royalties to partners
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SDS
Level 1
02-16-2020
10:23 PM
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I have a partnership that pays out royalties to individuals. Some of these individuals are the partners themselves. Are these payments to partners guaranteed payments for services?
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LG-CPA
Level 4
02-21-2020
12:10 PM
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Rev Rul 81-178, "To be a royalty, a payment must relate to the use of a valuable right." The payment of royalties, by that definition is not a payment for services, and so cannot meet the definition of a guaranteed payment for services.
